Modernizing legacy systems doesn’t occur overnight. It’s an incremental process that varies for every organization, contingent on its anticipated needs and target goals. For many organizations in the financial industry, this means integrating advanced analytics, mobile technologies, cloud computing, cybersecurity, among other things.
The main objective is to develop an efficient and flexible infrastructure. An infrastructure that can cater to the needs of the organization and support future innovations. Besides transforming old technology, it’s also crucial to reevaluate decades-old back-office processes. It includes marketing, sales, product development, product delivery, and customer service.
Tips to Make Digital Banking Transformation Successful
It’s a must to rethink such processes with the recent technological innovations in mind. If you’re currently on the path toward digital banking transformation, here’s a guide for you.
Trends in Digital Banking
The benefits brought by digital innovations in other industries have significantly influenced the trends in digital banking. People have seen and experienced positive changes in those fields. And they want them implemented in the financial service and banking industry.
Pre-pandemic, many banks were already reevaluating how they will improve the banking experience of consumers. The needs and expectations of customers serve as the catalyst for banks with legacy core systems. It helps to innovate and compete with the fintech firms.
Digital banking trends appear to be reaching not only younger consumers but also older customers. Consumers from every wealth group and age group prefer digital channels when they make transactions. These channels are more convenient and efficient.
Yes, digital banking transformation was already being applied by bank companies, but the Covid-19 crisis has impelled more banks to prioritize digital transformation in their marketing strategies, products, and services.
According to a study, 60% of banks say that they have put their investments in the latest automation technologies. The purpose is to enhance communication with consumers. Moreover, 70% have invested their money in developing improved customer-facing digital experiences.
The trend of using digital channels like social media has proved to be an effective means to strengthen brand loyalty. It reassures consumers during times of uncertainty by giving them updates with important details about their financial and bank accounts.
Pros and Cons of Digital Banking Transformation
Like other innovations in doing business, digital transformation in banking has its pros and cons. Read on below to know about them.
- Simplify Management. Digital transformation allows the workforce of financial institutions and their consumers to smoothly manage bank accounts, offline and online. Consumers can directly provide their information or promptly receive assistance from banking representatives online instead of managing paper records. Furthermore, you will eliminate instances of duplicate information because all data stays within the systems.
- Convenience. Online availability of bank accounts enables customers to access such accounts whenever and wherever they are so long as they are connected to the internet. Customers will have the convenience to monitor their bank transactions and manage their data. They change pieces of information such as their phone number without the need to visit their banks.
- 24/7 Accessibility. Going digital enables financial services and banking institutions to provide services 24/7. This 24/7 accessibility improves customer experience since it will reduce the need to go to physical branches of financial institutions and wait in long lines just to make an important transaction. Another positive thing about it is that it will boost the productivity of banking institutions’ staff.
- Security Challenges. Banks who undergo digital transformation are compelled to have secure technologies and processes to protect their digital assets as well as their customers’ digital assets. Thus, banking institutions should implement solid security measures to reduce the vulnerability to getting victimized by hackers and prevent security breaches. Of course, tightening digital and online security is not a walk in the park, which means financial institutions have to prepare for challenges along the way.
- Complex Transactions. When it comes to making banking transactions, the idea of fully going digital may just be an idea. People working in the banking industry need to understand that there are complex transactions that require customers to visit their banks due to security and validation purposes.
Tips to Keep in Mind
Here are some tips to keep in mind to increase the chances of success of digital banking transformation.
Provide the Vision
Transforming banking and financial services digitally is hard to achieve without vision. Senior bank executives need to commit to change their respective financial companies radically, and the company’s vision bolsters that commitment.
For digital banking transformation to become successful, there must be a clearly defined strategy, reinforced by the right financing, talent acquisition, receptiveness to agile methods of working, and a readiness to take risks.
Make sure to articulate the importance of digital transformation in banking, and never forget to emphasize its advantages for both employees and consumers. When you persuasively communicate its importance, your employees will get the motivation and purpose to achieve your goals, which will then translate to a better digital experience for customers.
It’s also a must to hear and take note of the concerns and challenges of your workforce while going through the digital transformation process. When your employees have struggled with adapting to these changes, you can find more manageable approaches without abandoning your vision.
Use Digital Channels to Inform and Educate Customers
Since consumers are navigating the constantly changing economy and their financial situations, traditional channels like bank call centers may not hold up to the flood of inquiries from a significant number of consumers. That’s why you must use digital channels to inform, update, and educate customers.
For example, you can answer frequently asked questions of customers by posting important information on your website and social media pages. Digital platforms can also help educate them about digital banking, such as how to download and use your bank’s mobile application, which is essential during this time of the pandemic.
Using videos is also a valuable way to inform consumers who are not that savvy when it comes to technology. You can teach them through video content how to check account balances and transfer money through mobile banking. Online chat or video conferencing also offers a remote way to talk with bank lenders.
With the restrictions on physical and direct interactions with customers, you should find ways to leverage digital platforms to provide service with them remotely. For your customers’ convenience, it’s an excellent idea to make the process of loan applications online or create a customized digital onboarding for new customers.
Indeed, going digital and exploring online platforms to help consumers manage their finances is necessary to become successful in the banking industry today. Failing to keep up with the developments in technology can get you behind the race.
Improve Consumer Experience
The Covid-19 pandemic has brought a significant change to the mindset of many people when it comes to digital technology. Now, we are seeing more folks using digital apps and other online platforms to live through this crisis.
The sophisticated mobile gadgets we have now, the enhanced utilization of data analytics. The latest digital applications have enabled consumers to search for stuff they want and get them in less time and with fewer hassles.
Another observation is that not only that the young people are taking advantage of these new technologies but also the old folks. The latter now make up a significant part of the number of users of these digital solutions.
Using Data and Analytics
It’s essential to harness the humongous amount of data we have today and use analytics and the capabilities of artificial intelligence to provide consumers the experiences they’re looking for.
Integrating big data and analytics with the organization’s operations help personalize engagement with their target audience, enhance security and privacy, and stay ahead of the competition in terms of production and revenue.
Knowing the preferences of consumers and using external sources to provide quick, contextual recommendations are what consumers expect from startups and businesses. The promise of personalization to deliver what consumers need should be one of the focuses of financial institutions.
Consumers look up to their credit unions and banks to use their personal preferences and behaviors. So, make sure to tap consumer data insights to create personalized solutions. Look for the existing challenges and goals in your organization that AI and advanced analytics can solve.
Examples of these are facilitating predictive product/service recommendations, product delivery, and fraud detection. Machine learning — as a component of the advanced analytics process – should be utilized to enhance data interpretation and AI should furnish high-level intelligence across the whole organization.
Foster a Culture of Innovation
Fostering a culture of innovation within a financial institution or company is crucial to digital banking transformation success. Just ask the masterminds and CEOs behind new digital legacy banks and disruptive financial technology firms. They’ll tell you that such culture is highly important.
Moreover, you can observe that companies and firms on the top rung of the digital transformation ladder have innovative leaders. Embracing innovation is essential to keep up with the competition in the banking industry. One of the lessons of the pandemic to financial institutions is to be innovative with the changing times and existing world problems.
Culture, Leadership and the Human Aspect
Yes, modern technology is everywhere, and organizations will harness its potential one way or another. But it’s all about the culture, leadership, and human aspect behind technology and innovation that will most likely drive success for an organization.
From the top to the bottom of the organizational structure, there should be a mindset for innovation to develop and implement the capabilities of the digital technologies we have today to make better consumer experiences and facilitate business efficiency.
Credit unions and banks should start with the needs of the consumers in mind. There should be a diagnostic stage with substantive input from consumers about their expectations before any effort is made – given the fact that consumer expectations are changing by the day.
Don’t forget to focus on small-scale changes to different aspects of the engagement that are easier to implement with prompts iterations over time. This approach is better than targeting one major change to enhance the consumer experience.
Introduce New Skills to Workforce
Most financial firms and organizations don’t have the talent base with the much-needed skills for starting a digital transformation. In such cases, it’s important to reskill their workforce to meet the requirements of this particular goal.
Financial service firms can hire new talents with the necessary skills or reskill a part of their existing workforce. It can be done using cross-functional deployment and training. It’s also crucial to consider necessary legacy mindset adjustments, given that back-office procedures and processes are reevaluated.
For example, how does a product manager rethink how to simplify the digital loan application process or build a digital deposit account?
New talents and your current employees should continue to learn relevant skills in their fields, especially about technological innovations.
Upgrade Systems and Processes
What prevents financial institutions from embarking on a digital transformation is the prevalence of old methods, technologies, and computer systems.
For example, if your firm is investing 70% of its IT budget on maintaining legacy systems, you’re putting a barrier to modernization.
It’s crucial to get updated with the needs of the time and work on those needs. For credit unions and banks, embracing agile principles and transitioning to cloud computing is the key.
Upgrading systems and processes within your organization will pave the path for success. After all, you can’t go to your destination if there are stumbling blocks along the way.
Financial institutions should embrace digital banking transformation since the competition in the finance industry right now is very tight. Failing to adopt new methods, processes, systems, and technologies, it’s sure that your organization will get left behind.
Start making improvements and adopting technological innovations to ensure the success of your organization.
Why (and How) Startups Should Implement Performance Management Early – ReadWrite
A company is only as successful as its people. However, early-stage companies often deprioritize proper talent management and place all their focus on the day-to-day operations of the business. These companies eventually find themselves reaching a point where their talent management processes aren’t keeping up with growth.
Hiring and retaining the right talent for your organization is just as crucial as having a great service or product, especially in the early stages of building a company. In this article, we list some important considerations in implementing employee performance management for startups.
Implementing Employee Performance Management Early
1) Define company values
Firstly, startups should define their company values. Values are the guiding principles and fundamental beliefs of an organization, and there are many benefits in defining company values early on. For example, having a core set of company values makes it easier for a company to hire and retain employees with the right aptitudes. Moreover, values help shape company culture, which will influence employee experience, engagement, and productivity.
In addition to defining values, startups need to ensure that their values are communicated frequently. Only 27 percent of U.S. employees strongly agree that they believe in their organization’s values. Instead of simply listing values on your website, startups need to integrate values into their talent management process. They can do this by:
- clearly and frequently communicating the company’s values
- aligning core values with behaviors expected from employees
- continuously monitoring employees’ actions and behaviors
Integrating values into the performance management process enables the employees to live and practice company values on a day-to-day basis. Companies can also make their values known during the hiring process – write the values in the job description and reiterate these values during the recruiting process.
Candidates and current employees should always be aware of the fundamental beliefs of the company. One tip on values – make them as actionable as possible. If one of your values is “honesty,” define specific behaviors that enforce and demonstrate honesty. (There are many resources (Korn Ferry, Iota Consultants, Ignition Group, etc.) that can help you define or adapt company values.)
“If I could go back and do Zappos all over again, I would actually come up with our values from day one.” – Tony Hsieh
2) Align goals
Effective performance management begins with goal alignment. Understanding company objectives is imperative. Half of the workforce doesn’t know what is expected of them. Managers should understand every company’s mission, clearly communicate the objectives, and make them easily accessible and visible for all team members (e.g., team-wide monthly progress report).
In terms of goal alignment, a common question that startups often face is “should I use OKRs?”
OKRs (Objectives and Key Results) are often used to cascade goals from the organizational level to the individual level. This can help create goal alignment as it helps employees understand how they contribute to organizational objectives.
OKRs are powerful; however, if a company’s strategies and objectives are frequently adapting (which is often the case in startups), the structured top-down approach of setting OKRs from the organizational level to department- and then to individual levels can be a hassle.
OKRs would need to be adjusted each time overall organizational strategies are changed. Frankly, this is a significant exercise that is not worth the time.
This doesn’t mean a company shouldn’t align goals. One approach is to set up OKRs at the organizational and department levels on a monthly basis and let managers delegate and own their key results and adapt as often as needed.
“Building a visionary company requires one percent vision and 99 percent alignment.” – Jim Collins and Jerry Porra
3) Develop a culture of feedback
Feedback is crucial in the talent management process. There are many benefits to having regular feedback conversations with employees. Firstly, it motivates employees, thus increasing employee engagement & productivity. Secondly, it generates lots of employee performance data which can enable better training and talent decisions. Finally, it enables better work relationships which can have a significant impact on company culture.
While managers may avoid giving feedback due to fear of hurting an employee’s feelings, more than half of employees want corrective feedback over praise and recognition! Most employees want real-time feedback and recognition for jobs well done.
The younger generations (Millennials and Generation Z) want 50 percent more feedback than other generations. Sharing feedback can be challenging at first. Enforcing the right processes and rituals early on will help ingrain feedback into your company culture. It is worth noting that creating and sustaining a culture of feedback is easiest to implement early on.
When it comes to documenting feedback, pen-and-paper approaches can be sufficient for early-stage companies. If an organization has more than 15 people, it will highly benefit from a performance management system that helps store and analyze feedback, objectives, etc., in one place. Ultimately, this will help simplify the performance management process and enable people analytics to help make better talent and training decisions.
“Make feedback normal. Not a performance review.” – Ed Batista
Implementing a performance management process in the workplace early on will better equip startups in developing and motivating their employees and ultimately improve a startup’s success and growth.
Remember that culture and people cannot be replicated – these two factors often differentiate a startup from its competitors. Your culture and people are worth the investment upfront.
Image Credit: ron lach; pexels; thank you!
Gabb Wireless Raises $14M in Series A Funding Led by Sandlot Partners and Taysom Hill – ReadWrite
Gabb Wireless Raises $14M in Series A Funding Led by Sandlot Partners and Taysom Hill
Gabb Wireless™ set itself apart from the crowd in 2018 when Founder and CEO, Stephen Dalby said, “enough is enough,” and began his journey to provide the only safe phones-for-kids.
LEHI, UTAH – APRIL 20, 2021
Dave Jensen, Managing Partner of Sandlot Partners, announced today that, “Sandlot Partners is investing and partnering with Gabb Wireless not only because of its impressive growth and positioning to lead the $30 billion smartphones-for-kids market — but also because it is providing solutions to address the significant screen time addiction problem in our society.”
Gabb Wireless™ is the first of its kind — a company determined to protect children by providing a safe cellular network for kids and their phones. Gabb created the only safe phones-for-kids serving this underserved demographic. Gabb announced this week that it closed a $14 million round of Series A, led by Sandlot Partners and New Orleans Saints quarterback, Taysom Hill.
“As an investor, Gabb checked all the boxes with its impressive growth, founding team and total addressable market. But it’s so much more than that for me. It’s the emotional side of the investment. I love the idea that we can help build something to help save kids in an area with so much need and demand. My wife Emily and I try to be pretty selective of who we tie our brand to — and when considering the chance to invest and partner with Gabb, it was a no-brainer for us and something that we are extremely excited about,” said Saints quarterback, Taysom Hill.
Stephen Dalby, Gabb Founder & CEO, announced the partnership with Sandlot Partners and Taysom Hill. “We’re excited to announce our partnership with Sandlot Partners and Taysom Hill, who share our passion for driving impact and providing solutions to the growing screen addiction among adolescents.”
“Sandlot has a strong track record of fueling growth and adding value to their portfolio companies. Taysom’s accomplishments as a BYU and Saints quarterback are well documented, and he’s also very impressive off the field and will be a great brand ambassador for the younger demographic Gabb is targeting.”
Kids need to be protected — and Gabb resolved on an action to do just that. Gabb set itself apart from the crowd in 2018 with a steadfast purpose to get safe, effective phones into the hands of parents who want to protect their children from inappropriate content and disturbing practices on social media and games, and other screen-time issues on the internet.
For some time, it’s been known that social media is affecting our youth with cyberbullying and other societal ills. The average child or pre-teen spends about four to seven hours a day of screen time. This disproportionate amount of time in front of a screen has caused depression, anxiety, and even sexual abuse among young adolescents.
Gabb said, “enough is enough,” and began its journey as a mobile virtual network operator, creating the safest technology available for children today. Gabb offers age-appropriate products to give kids the freedom to explore and their parent’s peace of mind. Children can enjoy their first phone experience with the affordable, $100 phone that protects them from internet dangers. Learn more at www.gabbwireless.com.
Gabb has had an unprecedented year of 471% growth and will use the proceeds from the Series A financing to accelerate efforts to provide safe phones for kids and expand its product lines — increasing Gabb’s total addressable market with these safe alternatives for parents of kids ages five to 15.
Sandlot Partners is an independent private investment firm partnering with noteworthy management owners and founders. Sandlot Partners help maximize the growth potential of businesses by providing companies with growth capital, strategic guidance, and partial liquidity. Sandlot leverages its network of founders and operators, identifies growth opportunities, helps structure, and offers additional strong risk-adjusted private investment opportunities. Sandlot investors also include family offices, strategic individuals, and like-minded institutions seeking strong alignment and providing patient capital.
Cooley, LLP, and VLP Law Group provided legal services for this transaction.
How to Build a Startup Team With an Entrepreneurial Mindset – ReadWrite
Much of your startup’s success will depend on the quality and integrity of the team you put together. With talented, committed, hardworking people, even a merely decent idea can turn into something groundbreaking. Conversely, even a great idea can struggle to survive if it doesn’t have a solid team in place to support it.
Obviously, you’ll need to work hard to choose the right people for your team – individuals with a solid experiential background, proof of ample talent, and genuine passion for the business. But beyond that, you’ll need to work actively to equip your team with the right mindsets and philosophies to guide them to productive, innovative work.
While there are conflicting opinions for what type of company culture works “best,” there’s no denying that your company can (and likely will) benefit from building a team with an “entrepreneurial mindset.” But what is this mentality, and how can you construct it from scratch?
What Is an “Entrepreneurial Mindset?”
Let’s start with a description of the “entrepreneurial mindset.” This is an internalized mentality, philosophy, and approach to working within the members of your team that mimics what the most ambitious entrepreneurs tend to feel.
The mindset includes:
- Creativity. Entrepreneurs are creative types. They want to create new ideas, modify existing ones, and come up with inventive new ways to deal with problems. They’re not afraid to think outside the box and try out new concepts – even if they don’t work out. They also like to encourage and promote creative ideas from other people, providing feedback, direction, and motivation to their teammates.
- Autonomy and independence. The entrepreneurial mindset also prioritizes autonomy and independence. Entrepreneurs in a business environment don’t wait for someone else to tell them what to do, and they generally don’t have to run their ideas through a bureaucratic chain of command to take action. Instead, they trust themselves, they operate decisively, and they remain agile. In an entrepreneurial environment, your employees will function autonomously in most cases as well.
- Change and growth. To be an entrepreneur is to accept the importance of change and growth. The only way for your business to reach more people and make more money is to evolve; that means adding new products and services, changing internal processes, and sometimes, pivoting the entire brand.
- Experimentation and adaptation. You probably already know how important it is to remain flexible and adaptable when growing your business. It’s also important for your workforce. With an entrepreneurial mindset, your team of employees will be much more likely to experiment with different approaches and adapt to new scenarios.
- Ambitious problem solving. Successful business owners are primarily ambitious problem solvers; they understand there’s some weakness or challenge in the world and are driven to “fix it.” With this mentality, your employees will be more likely to show enthusiasm when solving problems and rising to meet challenges.
The Value of an Entrepreneurial Team
So what’s the real value of an entrepreneurial team?
For starters, you can cut back on direct management and oversight. When all members of your team feel like they have a direct impact on their work environment, and when they’re empowered to do their best, they don’t need as much direction or supervision. Instead of looking over their shoulder, giving them project details, or micromanaging your employees, you can set priorities for them, trust that they’re going to work toward them, and shift your attention to more important matters. This lends itself to a less stressed, more inviting workplace – and allows you to be more productive while tackling the most important projects for your startup.
An entrepreneurial mindset also leads to a diversity of thought. When individuals are encouraged to have their own ideas, thoughts, and opinions, they tend to speak more openly in a collaborative environment. They’re more willing to volunteer ideas, offer constructive criticism, and provide meaningful feedback to each other. Such an environment makes it much easier to identify and get rid of bad ideas (before it’s too late), while simultaneously establishing the groundwork for the presentation of highly ingenious concepts.
Additionally, startups need to keep adapting if they’re going to stay alive. Over time, your target market might change, you might face new competition, and new challenges will threaten your previous approaches. The only way forward is to adapt, incorporating new systems and processes and changing your infrastructure. Ordinarily, teams of employees are reluctant to adapt – after all, most of us don’t particularly like change. However, when the team accepts the importance and value of ongoing adaptability, they’ll be much more likely to be onboard with your latest changes and experiments.
How to Build a Startup Team With an Entrepreneurial Mindset
Now for the big question – how can you build an entire startup team with a baked-in entrepreneurial mindset?
- Create the culture. Everything stems from your company culture. Before you employ any of the following strategies, make sure you have a solid idea for what you want your company culture to be. What are your core values? What is the “ideal” employee mindset? How should this mindset be fostered? What rules exist, if any, to enforce this? Document your company culture guidelines first.
- Choose the right candidates. With a culture document in place, you’ll find it much easier to interview candidates – and find out whether they’re a good fit for this environment. Even if they have a lot of talent and experience, they may not thrive in an entrepreneurial workplace; figure this out early, before you hire someone.
- Lead by example. You’re the leader, so set the tone. People will follow your example. Whatever habits you want your employees to practice, incorporate them into your own daily work.
- Nurture from the top down. You’re not the only leader within your organization, so make sure you select and support strong leaders who can embody and spread your desired entrepreneurial culture from the top down.
- Encourage independent management and decision making. Sometimes, employees will have to run their idea “up the ladder” before taking action. But as much as possible, it’s important to encourage autonomy and independent decision making. Empower your employees to make their own decisions, set their own goals, and devise their own approaches to work.
- Stimulate creativity. Creativity is vital for an entrepreneurial mindset to thrive. Use creative brainstorming sessions, music, art, and other exercises to encourage your team to think in novel ways.
- Get everyone to contribute in meetings. Encourage every member of your team to contribute in your meetings. More contributors will foster an environment of openness and collaborative sharing; it will also help you ferret out the best ideas, which otherwise might be held back by nervous participants.
- Reward good ideas. When a member of your team comes up with a good idea or solves a complex problem, reward them and publicly praise them. It will encourage further idea generation in the future and motivate other team members to volunteer their own ideas.
- Respect bad ideas. It’s not just about good ideas; it’s also important to tolerate and even respect bad ideas. When someone volunteers a questionable idea or makes a poor decision, show your support. Feel free to offer feedback and criticism, but don’t make the person feel bad for trying to do something inventive or helpful. You don’t want to punish people for trying something new.
- Remain adaptive. The most innovative, disruptive businesses are the ones that can adapt. Encourage your team members to remain similarly adaptable, keeping an open mind for new ideas and being willing to change when necessary.
Once your team is full of people thinking and acting like entrepreneurs, your company will be much more flexible, innovative, and productive. And best of all, this entrepreneurial culture tends to be self-sustaining; your employees will naturally spread it to new recruits and continue to foster this creative, efficient environment.